Test / Tutorial Book Name: _Acha Sanjay Dere Class: maa a Div. :_.9 Roll No. : 104% Sub. :_Managetal Ewnomics: © Scanned with OKEN Scanner+ Introduction __?- a im _hehaves _tahionally in the — mater of business __ derision. The-Rim needs ids plan Gr the tight volume a appropriate price Re its product & also the ___fiutike __e-panrion __of__i +: busines: and_all this in the back dtop 64 uncertair ~ Fareca Sing i a+ method which helps in __teducing the _uncetbaterhy Facer buy dilepenty . The ability te recast demand |_o Will __detetmine the future jst and conte | its Uinven-toky Makeover “Such _— Know) - ledge act @ a vital ol in the : > : makkehng _-leam_ eo Gen te decide | on__how mutch __ to invest = in ex'shng line__of product which. ene of good& or selvices +o enter in Reduce and hen — toate appa pinie Aine ek © scanned with OKEN Scanneree een et aa akch__technique of planning’ & decision Meaning of demand feasting = E uf Pal _furecasting i iS an et sales in dollars oF _phujsical units 4 ht “epecif et ane ad arden --ptoposed__makkeHng plan” & +he proce of determining fou _mnuch of hich _produtct is. -needed When and © scanned with OKEN Scanneraa ___ © | firm level = “This. wehees +h _Rerecatting _ of. | [a Categorisation | by level are “Fotecobshing a ae its _ptoduct by an nelividu- eal Sen ek isthe _ mos+._impottant _ | category of recasting _from_-the _ __Managek* viewpoint +n take Vakious — | impottank decisions _teladed fo —_prrduichon. and marketing @_Tndustey level = this is furecasting of demand — ft ._pimelck inning ia a__whole provides asight inte \evol fprecash Dg provides an__insight int dhe _telative tondibutinn of ey in -pacinnal —iniome ® “enema = “his etna foes | cf aggteqate —_clemand __in _-the___esene my —— a reer mis helps_ in VaHous policy —Tfraulations ak qevernnnent Level —___— © scanned with OKEN Scannerbates oe BL categorisation b 2 Time Petiod t= Tanned tucmsiing Ga combine with _-the xed -tn__opdimise the, _level_-of ptiaah (The main fous ef such friecasting i on _+he Short fetm -phodiickon decision of any fim. +o avoid aver Pkocduckon or under ptoduckon. sh helps in aking clerésion_. -¢ |_inventosy , cost on vatiable factors Sales__-turgets & ist —such a new _—4 © scanned with OKEN Scanner©_|_ Consumer ge Demand_forecabting is ______| indespensable __for__consumet___good& Fok ___ durable consumer __-_ good& clemand Frtecas-}i- ——_| +hey __can__ptndce__- This __« of + clemanel Forecaahng is highly comp! ere. |buce__Very important for lang. -tekm __gtow)- © scanned with OKEN Scanner| [choice of afarecasting —_dechnique- depends _ 4 on_abjeckives_,_wosts _, time nate ob _ data and comp lexity oh the technique__ ——©__consumers' opinion _gukvey_- — Survey of consumers of buyer's ——_——inkenions tests on the _holief hat the hest and the mos}. obV/iou Wal to -quage the demand for a oe : ty duke opinion of the _‘ukets, the sy Ee ake _oSked about thelr Fulyite —____| htand __piefuences andl _quarkhea oh pukchads : ; Ways. The rst one known ah censu method involve: Contacting earth g every bum er Rte nee, Very time. is__often not © scanned with OKEN ScannerPoona: J > Ce a) @_ | the _uustemets.__and__are__in a better ———_ -Sale&persons __are __ _ Salesforce composite = __ SaleBpetsons ake _in __dikeck contact witb position _-to___-foreeast __dlemane|_ Rie ony Product _._to__sales_-farce__composite _tme-thed —abked about hei —— 1, -ve__Sale ferrites in time __The Sum _-retal of such eshmates Savon the basi chk frrecasted —_clemaned pert» opinion method _~ | This metho} of otecasting demand is ———-essencially based on the opinion ~ of _expett ———ither internal or __eytetnal ty the | Gem @ _ot\ mar be -aken - with -+the help of brain stnkming sessions. ——_] —— —_| —_| ‘Welphi_Technique * Another method of wm eckng one \s by ec elbhi echniqu " a by he Ranal___okpotakon at _-the Lheginning of the _coldl_wlat_. -fy foie} the |impact ck__‘ethnology on __watfate Delphi is_ © scanned with OKEN Scannerba may of getting —-the__opinion of epells, + “withouk their face. ++» face__in-letadion.._ | By this method __a__pannel — of carefully. | selecking__inclepenalent- emperts lquestionnalies —_in__two or _moke _tounel ak the end ot hich aun. catches eee a anonymous wuromery eath experts _ opinion is ___provicledl (11cm 4 © scanned with OKEN Scanner_@: 2 _disknguish__-the -types of costs whi q: 3 gu yp acetding to 4th, ei pkodiictiom, ini | —— > TMpes of __costs __*= : _]_| Fixed Costs - These ate = cost stha+ do not |v fi tH Starts i ,—tt Needs _-+tp _spendl__on plant _, machinery 4 ng equipments, etc io fack the fem. hag” +p bear these costs even if thete is no output . qRese. = ? ub sidiany costs. to. 3 = 12 Wve a | costs CZ) Za ES I] ; | E ‘ © scanned with OKEN Scannerze | iE \ IP 9 ‘Scanned with OKEN Scanner | Natiable__ Costs - These costs that Vat —_ |—with output and ale —ineueted_—4N_____ |—geting mote 4 __m olt_-.inpwts —i—Vatlable_ & —|-@sts ~_ate__equal__to _zeto__if __thelt_is_ ——|-ho_ottkputt Examples induces —1ost—at Vatiable cost - wutve ~ Should he a Straight tine buck a Youll soe that in athe _gtaph___Tvc. “is an inverse _S Shaped _ pWakel sloping auve stark ng fom otigin This__shape is __ determined _by the aud cf vatiable propottions_Accatding -ts__+this, —_____| low) as mote and mote __units of +he Vatiable _ faclot_ ake .adeled in pisp__prodil- chon its Pocuchy ity goes on dnaeasing fwekage sts - _AVelige wSt is _cmct pet unit of output we can _detive __Average Rued wet __ Avetage-_vatiable cast __& aVelaqe inst from otal_ixed hota) vatiable and __+tetal__WoSts__teSpechv ell Arc is xed _cogt pek anit of _ovutput Landis hus equal __-ty_+he takin _of tke: and units _ of output Ave ic vaH-. | able__uns+_pet_unit of ouput _and is _- | thus equal_+to the tatin of we and units of output _1 Ac ig _-tntal_ms+ pektyne: db Dae: TT __—-sf unit of output : ‘and , _\s__sthub_equal__te |the__teko_of __te__and___units of output, _ i ee eeenee iy 7 _|__Mc. = I : oe quantity i ©. jth = margins in _-whal__cos+ o_unit chang e + | Lin oulpal cAingase dhe vedo cael fom ponent cof ust __can Nok be _-abteked, me —_|-is__vittually the change _in__vatiable ost _ | tntnl_ cog __ Thestfote__i+ change in per unit change is__also. Known in__output oh tale __of © scanned with OKEN Scannerea What is producer's __equili brium 8 Explain | with example ___ [he prodiichon faunchion —dlesutibes technology , ——_| not etonomic _hehaviouk 9 # auinise__jts__piehts given its —plduckon. i generally takes the. phoduiction funchon as a, giveo___elemen+ of that _ptoblem Tn __ specialised Jong tun model: ; hoo 3 D in ~ enis +n _ choose among ‘ . logies. Producer's equilibrium tonsis+ cf _Awo concepts: i An isoquank auve is. the Jocus ot ptoducdng a given level of outpu__Ts0-_ quants ate similar +o indifference cut e& | the only —aiistinchion being that a__differen+. . combinations. of do loputs — nd__to__the__same level ef a © scanned with OKEN Scanner“Asequan} curve i > > [about Che) : ® soms+ lines - The concep} cf page — Teounst line is _Similak +o that of the budget tine fot tye Commun ek Tk can be said that the - ———1_Isomst line is__the budget ine _ef a Producer in_Aerma ok two points {> input Ake _isowst line gives alt" possi el inotinng of labour & capi ih a Sym__can__employ, given _the __priu ef —__pYadre. dnputs [ © scanned with OKEN Scannercrsoust Jine- Tabour |_decision is -tnken on the _howig of | -esnnomic__efRdency , ie. use that combination — | which__minimises the tos ef __pinalucdion __ Hen, Producde must delermine _+the combination of _ ft in Lat minionumn cost at maximising fftm_wil) Av\y_-to__ube oo _tombinebon o> | Phe ud \\__mini © scanned with OKEN Scanner| Tso re, (qe) K Ra aquan—a labour) 6 i Uibti : ox poi+ CE) where the Tsoquan} curve : : | Below __-the point CE), producer _will__nevet Mea pi w because i+ will be the __undetutilisation oR = pests —— and silat the pa — ; can't _pindu@ __bécape _it is ___ —_—___] overutilisation a. Fine © scanned with OKEN Scanner-@:41__| nefne on _ts0.quant_._(an _an__isoquant_be _ —_Ltencave 4p the _—_otigin _® fee eee _. An_isoquant curve is the —louus eee technically efficient __ ombinabions __S_ptedulding — = ee ————_onlly____distinetion being that __isoquants ate _ dis cartes pond __-tp the same __| evel of oulput isoquants ake algo __\eReked bn ah iso Product CLV ¥ ft Capita) \ Tsoqiant curve @) + oO ae = ke labour CL). © scanned with OKEN Scanner| chatacletistics of _tsequant_cutve 2) | Bownwatd sloping ts the kight_- ___— Technological __efRciency connotes that an _isoquar must slope __downwatcls fom lef tn tight which__implies that using mol _£ mote one Anpuk__-bo___plodut the, Same level __ of ol tous} __trnply using - less ob the. other input thus “if more of labour is 4 j 4 kores' Some level _of output: Slope of reoquant cue = = AK , AL 2 | A higher “soq uant reple ent a__higher © pika| [ \ Nc as © scanned with OKEN Scanner\ ‘Ee 18 > } Owe: | Th_4the fig. 1F we onsiclet__poink 8 on Lthe -auve: @: 2 onint c+! on “@ the curve _@.,_you__can__-Fellow__thak_c__has_ Moke number of both labo & Capital _ AS__compated _A_Thus ab per __given. _Hechno-_ ogy mote of beth factors _ should _produa_ fs Ca V0 a os highek__isoquan+ cue __a point will have qveakek amon): of both the inputs | : 1 : : at i+ will have a _ geeate _quantsty ch at leadk one of +he Lino inputs _aa in case oh A and pg | the uno inputs util tender a higher \ovel of —oukput Ey Tsnquants __alo_no+ _intetsech _- 7 : * \ cf \h \ ei ors Qe © scanned with OKEN Scanner— 4s seat — _an isoquant a the level of __ output conte of two “inpit ail poe ee ee Anput__combinarion producing wo levels Lot tut ‘ Rake et A and RB be so eachother at point c At point _@ TS anl_c of isoquant _@i_.+he frm the__same level of output "Again points A ond coh denne the same level output ao. bythe Rim _Thub_i+ _fatiows that ot point ond a tie of | output ould be ptoduced But _rarn_-the Ra te it is. cleat that roin-+ fh clenotes Ja" higher level ef output thang @ t__isoquants cannot. : | inverseck eath other | Teoquuan aise can net be concave bo _ the because itis always conven the _otigin due tothe follow= aing \eadons — © scanned with OKEN ScannerPagan: 20 (> Dues 1d ; 4) | Convex tothe _obigin = : _ Given _subsk4uabi lity —bebneen—Faclot—tnpuis ' asthe frm _comfnues _-}>__-employ ie less one input __Say, labour and other _saty_copital a situation ik homed ifGault te substitute labour [fr capital. Since__labow _and___capl:tesl__ate. nok poxtect. subshtules therefore. a Capital js__Kept Aoied to pinduce aclditvonal _units_ ‘ - ; : ot _labowk This is bette _Uncletstood with the help of the ‘lau ot Maxginal Ra ad Technica) Substitution — i © scanned with OKEN Scannera> _ aq: 5l__| Whet_is___envelnpe __aurve 3 — explain _gtaphically. os, -long.tun_—austage 8 oa — when plan}__sive and other fed inputs ofthe _vin__inerrake__in the _e@¢het- long kun__the shor} tun tos} curves __shifte fo. athe tight We Start with: the -_plemice’ ia he long ihe fem petals with sniee di ffaven plant ___sives an depenching on (ost cans} detovon’ Thus sAc1 welates “to avotage ust of the Rim when Ac plank size is | sal) + uhen plan} size Inceohes ty ar the ces ponding — Sic ce is, Aco and oon. | | ae ; | jn_athe short tun the fim can canine : +tp_phoduce. along _ sfc uhlising its. : : , ' —— bot an output : i ‘ —___lis overwork, i ee fr the Rim tn shift bp a te hlahek plant. size Sau _Ir ah 5 s uit Ce alain ou form SAC, ould lower the. awetnge wast a. We Sum © scanned with OKEN Scanneragen: 22 ‘ Dee: I Fall owing _-the _same logic, she, same_ptocess, wlottld be ___epeated _if athe Rum _anueases its output __-fiuthet__-to__4,. The Ac Gwe _ lis deuwn __ with a bold dine __ The _aakve hak _a_Scallnping patter ___a& it js __clkauin with three —_plant__sizes only, —_twitthout — smonth ening, - ¥ &cl ce in mea a me SRC D shC3 sp de Io % Fo quankty ) Sg cael Sate i opekates —With only three aktelnate hin __teality eo |-Sizes ,_-thoug| howe _rquitiple “auch adernallves ———ik_may have Mui ple sAc ‘alan ng by the —aldetnative plants the ~ 10, SThe [Ac | finchinn is an -ON- envelope uy | fundiong and the__spc_cutves hone. the Lac curve © scanned with OKEN Scanneris also kann _ as. .an envelope. —autve)__ This_envelop_patein_can_be_seen__in_fig-— in_which. the Lc curved_ envelopes __ Sac, Sice & sacs, showing -the _ Lavelage cos} oh __prmcluction _at different \evels__of output __prrd@ad __bu_plant + Wand ma 7+ _wauld envelope aman —|-SAc.,.,o Would _be _-the __awailable “plant ce __| sizes nee — Ac falls when me < Ac _ Ac__ feats -tises when ___mc_7 Ac Ac is minimum When me = ac | Each of 4h Vv. | eet ee | -copacety 3 _in__vontrast Lc ae _sequence of | nia auih ef ake ah {yes on dite sc ctv “Teach of these points teplesents a single optimal {plants size — The lhc CUO. frie he ‘planning curve". ab it He planning —hotizon —inwhich — mist+__-can select the. | wos -cxpphoprierle_ te _size__qiven_the ___ isting tae oe fathead © scanned with OKEN Scanneroes ca © scanned with OKEN Scanner